Many New York employers, eager to avoid litigation, ask their employees to sign severance agreements if they are terminated or laid off. A severance agreement typically offers the employee some additional compensation in exchange for waiving any potential employment discrimination claims under federal and state law. In effect, the severance payments serve as a full settlement of any such claims and release the employer from all further liability.
Courts Rule Employee Failed to Revoke Agreement Within Seven-Day Period
In general, these kind of waivers are valid and legally enforceable in court. Depending on the type of discrimination involved, a waiver or release may have to comply with certain rules. For example, a waiver with respect to age discrimination is subject to the federal Older Workers Benefit Protection Act (OWBPA). This law only applies when the laid off or terminated employee is age 40 or older.
A waiver of age discrimination claims must meet several minimum requirements under the OWBPA, including:
- The waiver must be drafted in “plain language” so the employee can understand its terms;
- The waiver must expressly state it applies to potential claims under the Age Discrimination in Employment Act;
- The waiver must tell the employee that he or she has the right to consult a qualified employment law attorney before signing the agreement;
- The employee must have at least 21 days “from the date of the employer's final offer” to consider the severance agreement; and
- If the employee does sign, he or she has seven days to revoke their signature and consent to the waiver.
It is critical for employees to understand their rights, as well as their obligations, under laws like the OWBPA. Courts will hold both the employer and employee to a strict reading of the law. If the employee fails to assert his or her rights in a timely manner, they will likely be forfeited.
Consider this recent case from here in New York City. The plaintiff attempted to file an age discrimination lawsuit against his former employer. The employer claimed the employee was fired for misconduct. The employee belonged to a union, which conducted a grievance procedure that resulted in a severance agreement. This agreement included a standard waiver and release of “any and all claims” that may arise from the plaintiff's “employment” or “termination.”
As required by the OWBPA, the release included a seven-day revocation clause. Specifically, the clause said the employee had to notify the employer “in writing” if he wished to revoke his signature. According to the plaintiff, he “instructed his attorney to revoke the Release,” but he did not say whether that instruction was ever communicated in writing to the employer. As a result, a federal district court and the U.S. Second Circuit Court of Appeals ultimately dismissed the plaintiff's age discrimination case as barred by a valid, enforceable waiver.
Get Help From a New York City Age Discrimination Attorney
As noted above, the OWBPA and similar laws require your employer to advise you to consult an attorney before signing a severance agreement or similar waiver. Take this advice seriously. Before signing any document that may affect your legal rights, you need to speak with a New York employment discrimination lawyer. If you need immediate assistance, contact the Law Offices of Mahir S. Nisar at (800) 496-3076.